Technological advancement has reshaped how we live our day-to-day lives.
And the financial markets are not marked safe from it – developing trading APIs or robots to automate investment decisions on your behalf.
Unfortunately, the boom of these trading robots was the entry point for unethical service providers to defraud unsuspecting investors.
In South Africa, QZ Asset Management provides access to its Big Data and Artificial Intelligence (BDAI) analytics. For a minimum deposit of USD 100, the company claimed to provide investors with 400% ROI and other luxury items.
Are these promises true, or are they just made to deceive unsuspecting investors? This TRU Insight explores everything you need to know about QZ Asset Management, from the investment opportunities it offers to its seemingly Ponzi operations.
What Is QZ Asset Management?
QZ Asset Management is a China-based investment platform that provides traders access to equities and indices markets using its developed Big Data Artificial Intelligence (BDAI).
The company started operating in 2019, targeting the Philippines and other Southeast Asian markets. However, its business operation ended in May 2023 after the company collapsed. This event ultimately revealed the Ponzi scheme operation of QZ Asset Management.
Claims received by the Financial Sector Conduct Authority (FSCA) revealed that the company operated and garnered investments through a Multi-level marketing business model.
Further investigations showed that local South African promoters were valuable in increasing the investment company’s reach in social media. In the marketing videos, promoters promised luxury items for the investors aside from the actual return on investment.
Remember, social media platforms are largely unregulated, making them a breeding ground for investment scams.
Offered Investment Opportunities of QZ Asset Management
Before diving deeper into the Ponzi scheme operations of QZ Asset Management, let us first look at its investment opportunities. By looking at this lens, you’ll learn the common red flags of an investment-disguised Ponzi scheme.
On its website (qzinvest.com), QZ Asset Management claims to offer investors a chance to enjoy 400% ROI from a minimum deposit of USD 100. The company claimed its possibility through a sophisticated trading bot named Big Data Artificial Intelligence (BDAI).
By using DBAI, an unsuspecting investor can access the equities and indices markets without all the necessary leg-work to profit. The trading bot was claimed to make informed investment decisions on behalf of the members.
However, the appeal of this investment platform goes beyond the potential four-fold profits. In fact, local promoters were successful in recruiting new members as they promised to give away luxury items if the recruited members met the criteria. This includes:
- Ferrari
- Hermes Bags
- 5-Star Hotel Stays
- Rolex Watch
- Mercedes Benz
Coupled with the chance of securing a better financial future, unsuspecting South African investors took the bait. Not knowing that it’s a one-way street to financial losses.
Is QZ Asset Management Linked to Qianze Asset Management Limited?
Yes, QZ Asset Management is linked to the collapsed Qianze Asset Management Limited.
In fact, everything about the two is the same – just in different names.
Qianze Asset Management was Blake Yeung’s first take on the Ponzi scheme in 2019. It originally targeted Asian countries like the Philippines and South Korea.
However, Yeung’s Qianze Asset Management collapsed in 2021 and did not set foot in the financial markets until late 2022.
But to continue its Ponzi fraud operation, Yeung rebooted his company to QZ Asset Management. Only this time, its primary market was African countries like South Africa.
The Ponzi Scheme Operation of QZ Asset Management
Looking closely at QZ Asset Management, one can discern its Ponzi scheme operations.
In fact, all the marketing materials used by the company check the common red flags of a Ponzi fraud.
Related: What Is Investment Ponzi Scheme: South Africa Financial Terrorists : QZ Asset Management Review: Is It A Legit and Regulated BrokerThe Promised 400% Weekly Return and Luxury Products
The first truth-teller of a Ponzi fraud is its too-good-to-be-true promises. Remember, it’s their way to snatch the interest of the unsuspecting investors as they’ve become blinded by the outrageous investment opportunities.
In the case of QZ Asset Management, this red flag was evident in their promised weekly 400% investment returns from a minimum deposit of USD 100. This alone could snatch the trust of investors.
But they’ve made it more appealing by giving away luxury items to the members if they meet a certain condition or requirement.
While fixed-income investments exist (government bonds), they have legitimate and sufficient means to grow the investments of their investors.
On the flip side, Ponzi frauds don’t have any retailable investment products to sustain their business operations and potential investor incomes.
Non-Existent Investment Products
Another red flag to look out for is the existence of the investment products and the underlying strategies to grow the investors’ investment capital.
This factor should go without saying – after all, how can the company grow its capital if it doesn’t have an investment product to sell or an investment strategy?
While QZ Asset Management markets its BDAI bot to stock and indices investment, it doesn’t have any more information on the success rate of the trading robot. The members don’t even know if they were really investing in the stock or indices markets.
What’s certain is that investors can profit by climbing the affiliate ranking – which is possible by recruiting more investors into the scheme.
The Recruitment-Reliant Profit Model
Again, the multi-level marketing (MLM) business and profit models of QZ Asset Management were apparent.
Let us look deeper into the MLM operation of this company:
Compensation Plan
In its front, the member must invest a minimum of USD 100 and USD 1,000 to access weekly investment returns.
| Membership Plan | Minimum Deposit | Weekly Return |
| QZ Basic | USD 100 | |
| QZ Elit | USD 1000 |
However, the members were presented with a “more profitable” way. That is through the recruitment compensation plan.
That’s by recruiting members into the scheme to earn a 10% affiliate bonus and building a series of drawdowns for 10% binary bonuses.
Affiliate Ranking and Incentives
Affiliate programs are common in fintech companies. This is because a lot of investors (fintech clients) put more trust in the recommendations of those who came before them.
However, this excessive reliance on recruitment programs is the common tell-tale sign of a Ponzi fraud.
In the case of QZ Asset Management, the affiliate program is the only way for investors to profit. Through the “investment” platform, all affiliates or promoters receive 10% of the investments from their recruited members.
Aside from the fixed commission they got from the program, they could also earn accumulated residual commissions and a one-time gift each time they climbed up the affiliate ranking.
Here is the overview of QZ Asset Management’s affiliate ranking and incentives.
| Ranking | Accumulated Residual Commission | One-time Gift |
| Rank 1 | USD 3000 | USD 500 |
| Vice President | USD 6000 | Samsung Galaxy 22 |
| Senior Vice President | USD 20000 | Rolex Datejust |
| Executive Vice President | USD 50000 | Rolex Submariner |
| Director | USD 150000 | Mercedes-Benz GLC |
Aside from this, the promoter also earns 10% binary commissions each time their recruited members recruit new members.
Let’s put it into perspective by looking at Investor John’s situation.
John recruited Adam and Lukas into the scheme with an accumulated USD 500 deposit. This ultimately earned him USD 50 through the affiliate program (10% commission).
A few months later, Adam and Lukas recruited a total of 15 new members with a total of USD 25,000 deposit. Both Adam and Lukas earn their respective 10% from their drawdown. On the upper part of the pyramid, John earns 10% from the affiliate earnings of Adam and Lukas.
Does QZ Asset Management Operate in South Africa?
Yes, according to Qianze Asset Management – trading at QZ Asset Management China – QZ Asset Management extended its operation in South Africa after successfully operating in South East Asia, specifically in the Philippines.
Blake Yeung, the CEO of QZ Asset Management, stated that the company will build its own 3,000-square-foot office in Johannesburg.
Additionally, the company announced its plan to be listed on the New York Stock Exchange. With this plan, Yeung and the promoters urged the members to invest USD 2 to stay ahead of the potential listing.
QZ Asset Management Received Fraud-Warnings from Regulators
Both the Financial Sector Conduct Authority (FSCA) of South Africa and the Philippine Securities and Exchange Commissions (PH SEC) warned the public about the potential scam activities of QZ Asset Management.
As revealed by the regulators, the company rendered financial services and solicited investments within the Filipino and South African jurisdictions.
All financial service providers were mandated by the financial sector laws to attain the necessary authorization and license to solicit investments from the public. This ensures that the jurisdictions’ financial landscape remains safe from potential money laundering and financial terrorism.
QZ Asset Management was not authorized by the FSCA and PH SEC. Thus, the regulators advise the public not to transact with the company.
